SHILLONG: Meghalaya’s fiscal performance has deteriorated over the years due to various reasons, including law and order and political situation, says an independent study by a research scholar at North-Eastern Hill University (NEHU).
The exhaustive data collected by the research scholar Samir UL Hassan shows though Meghalaya is a special category state and gets more central grants than loan it is unable to attain revenue sufficiency and is going for debt.
“The average of debt as a percentage of GSDP (gross state domestic product) shows an increasing trend for Meghalaya that is negative in terms of revenue management and planning for developmental expenditure,” says the study.
The fiscal health of the state paints a gloomy picture as public expenditure constitutes more than 36 per cent of Meghalaya’s income and the state’s own revenue contributes only about 20 per cent to the total revenue and no more than 3.65 per cent of the state income.
Hassan’s study notes that Meghalaya’s revenue potential has been tapped nominally till date leading to a fiscal disorder and subsequently an explosive growth of public expenditure. “The state’s expenditures deserve a greater and more critical scrutiny,” the study suggests.
“In the fiscal structure of Meghalaya there are different types of non-plan revenue expenditure other than the interest payment, which simply adds to the burden,” says Hassan in his study.
Though certain significant developments have taken place in some spheres in the state since Independence, the access to opportunities for a ‘reasonably minimum standard of living’ is one of the lowest in the country and the state’s developmental efforts have resulted in a paradoxical growth where the exponential growth rate of the state’s income stays at 12.61 per cent and that of public expenditure at 14.68 per cent.
The study also shows that Meghalaya has a weak revenue base and most of the expenditure goes to non-productive purposes which do not add any value to the capital base of the state.
A close scrutiny of resource mobilisation becomes imminent at a time when the state’s own tax contributes only 7.05 per cent to the total public expenditure and total tax contribution to public expenditure remains at 26.37 per cent.
